Mitcham Industries Reports Record Fiscal 2012 First Quarter Results

HUNTSVILLE, Texas, June 6, 2011 /PRNewswire/ -- Mitcham Industries, Inc. (NASDAQ: MIND) (the "Company") today announced record financial results for its fiscal 2012 first quarter ended April 30, 2011.  

Total revenues for the first quarter increased 61% to $26.5 million from $16.5 million in the first quarter of fiscal 2011.  Core leasing revenues increased 75% to $16.8 million in the first three months of fiscal 2012.  Net income for the first quarter increased 155% to $6.1 million, or $0.58 per diluted share, from $2.4 million, or $0.24 per diluted share, in the first quarter of fiscal 2011.  EBITDA (earnings before interest, taxes, depreciation and amortization) for the fiscal 2012 first quarter more than doubled to $15.1 million, or 57% of total revenues, from $7.3 million, or 44% of total revenues, in the same period last year.  EBITDA, which is not a measure determined in accordance with United States generally accepted accounting principles ("GAAP"), is defined and reconciled to reported net income and cash provided by operating activities, the most comparable GAAP measures, in Note A under the accompanying financial tables.

Bill Mitcham, the Company's President and CEO, stated, "We are extremely pleased with this strong start to the fiscal year.  This was a record quarter in terms of total revenues, core leasing revenues, earnings per share and EBITDA.  The results of this quarter demonstrate the revenue generating capacity we have added through strategic purchases of new lease pool equipment in the past few years, as well as the operating leverage of overall increased utilization of our lease pool.  Seamap also had an excellent quarter and continues to be a steady source of solid profits.

"We generated exceptional results in our equipment leasing business in the first quarter, led by strength in Canada and Russia where we enjoyed especially high equipment utilization during the winter season.  We benefitted from improved demand in our downhole tool business, steady growth in Latin America and continued strong activity in our marine leasing business.  We also began to see improvement in the United States.  Our Seamap segment produced outstanding results, delivering two GunLink 4000 and two BuoyLink systems along with additional equipment sales and ongoing repair and service work.

"The second and third quarters of our fiscal year are historically our weakest due to the end of the winter season in Canada and Russia and, therefore, we do expect some decrease from the first quarter's leasing revenues.  However, we are encouraged by what we have experienced so far this year in terms of bid and order activity, and there continue to be indications of growing demand for our services.  We are seeing strength in many international markets, including Latin America and Eastern Europe.  Marine leasing activity is steady, and demand for our downhole tools is improving.  Recently, we significantly expanded our presence in Latin America, adding approximately 20,000 additional land channels and associated equipment there in response to customer demand.  We also believe Seamap will continue to benefit from growing demand for our GunLink 4000 and BuoyLink systems as marine contractors seek to improve and expand their capabilities with our industry-leading technology."  

FIRST QUARTER FISCAL 2012 RESULTS

Total revenues for the fiscal 2012 first quarter increased to $26.5 million from $16.5 million a year ago, driven by excellent results in our equipment leasing business and at Seamap.  A significant portion of the Company's revenues are typically generated from sources outside the United States, and during the first quarter of fiscal 2012, the percentage of revenues from international customers was approximately 81% compared to 89% in the first quarter of fiscal 2011.  

Core equipment leasing revenues, excluding equipment sales, increased 75% to $16.8 million from $9.6 million in the same period a year ago, primarily due to strength in the Company's Canadian business during the winter season, solid growth for downhole seismic tools, improved demand in the United States and increased demand in Latin America.

Sales of lease pool equipment were $335,000 compared to $363,000 in the first quarter of fiscal 2011.  Sales of new seismic, hydrographic and oceanographic equipment were $1.0 million compared to $790,000 in the comparable period a year ago.  

Seamap equipment sales increased 44% to $8.3 million from $5.8 million in the comparable quarter a year ago, primarily attributable to the delivery of two GunLink 4000 systems and two BuoyLink systems along with a significant amount of ongoing service and repair work in the quarter.

Lease pool depreciation in the fiscal 2012 first quarter was $6.1 million compared to $4.9 million in the same period last year, a 24% increase.  This increase resulted from additions made to the Company's lease pool during fiscal 2011, which totaled approximately $31 million and included Sercel's Unite cable-free land acquisition equipment, traditional cabled land acquisition equipment, downhole seismic tools and a variety of marine equipment.

Gross profit in the first quarter doubled to $13.9 million from $6.9 million in the same period last year as a result of substantially higher revenues in both the equipment leasing and Seamap segments.  Gross profit margin for the first quarter of fiscal 2012 increased to 53% compared to 42% in the same period a year ago.

General and administrative ("G&A") expenses for the first quarter of fiscal 2012 were $4.6 million compared to $4.2 million in the first quarter of fiscal 2011.  Last year's first quarter results included a gain of $1.3 million related to the acquisition of AES.  

CONFERENCE CALL

The Company has scheduled a conference call for Tuesday, June 7, 2011 at 9:00 a.m. Eastern Time to discuss its fiscal 2012 first quarter results.  To access the call, please dial (480) 6299692 and ask for the Mitcham Industries call at least 10 minutes prior to the start time.  Investors may also listen to the conference live on the Mitcham Industries corporate website, http://www.mitchamindustries.com, by logging on that site and clicking "Investors."  A telephonic replay of the conference call will be available through June 21, 2011 and may be accessed by calling (303) 5903030, and using the passcode 4442371#.  A web cast archive will also be available at http://www.mitchamindustries.com shortly after the call and will be accessible for approximately 90 days.  For more information, please contact Donna Washburn at DRG&L at (713) 5296600 or email [email protected].

Mitcham Industries, Inc., a geophysical equipment supplier, offers for lease or sale, new and "experienced" seismic equipment to the oil and gas industry, seismic contractors, environmental agencies, government agencies and universities. Headquartered in Texas, with sales and services offices in Calgary, Canada; Brisbane, Australia; Singapore; Ufa, Bashkortostan, Russia; Lima, Peru; Bogota, Colombia and the United Kingdom, Mitcham conducts operations on a global scale and is the largest independent exploration equipment lessor in the industry.  Through its Seamap business, the Company designs, manufactures and sells specialized seismic marine equipment.

This press release includes forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 and Section 27A of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts included herein, including statements regarding the Company's future financial position and results of operations, the Company's business strategy and other plans for future expansion, the future mix of revenues and business, future demand for the Company's services and general conditions in the energy industry in general and seismic service industry, are forward-looking statements. While management believes that these forward-looking statements are reasonable when and as made, actual results may differ materially from such forward-looking statements. Important factors that could cause or contribute to such differences include possible decline in demand for seismic data and our services; the effect of  fluctuations in oil and natural gas prices on exploration activity; the effect of uncertainty in financial markets on our customers' and our ability to obtain financing; loss of significant customers; seasonal fluctuations that can adversely affect our business; defaults by customers on amounts due us; possible impairment of long-lived assets; risks associated with our manufacturing  operations; inability to obtain funding or to obtain funding under acceptable terms; intellectual property claims by third parties; risks associated with our foreign operation, including foreign currency exchange risk; and other factors that are disclosed in the Company's filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, which are available from the Company without charge. Readers are cautioned to not place undue reliance on forward-looking statements which speak only as of the date of this release and the Company undertakes no duty to update or revise any forward-looking statement whether as a result of new information, future events or otherwise.

SOURCE Mitcham Industries, Inc.